Banking heads reveal plans to take on the FinTech challenge
Exclusive research commissioned by Banking Circle reveals how financial institutions are focusing on digital as they step up to the challenges ahead
London, 21st May 2018 – Saxo Payments Banking Circle, the global scale financial utility, has published a white paper which provides insight into the thinking of those working in the banking sector about future challenges. Following in-depth interviews with heads of correspondent banking, cash management and transaction banking, at large and mid-tier institutions including BNP Paribas, Danske Bank, Standard Chartered and Citi, the detailed white paper reveals that banks of all sizes are stepping up to meet the FinTech threat head-on.
‘Re-drawing the Map: The changing landscape of cross border banking and payments’, shows how banks are in pole position to seize the opportunity of the industry overhaul being brought about by the growth of digital. Reflecting the general attitude of all interviewees, Marc Recker, Global Head of Institutional Market Management at Deutsche Bank commented: “We’re not complacent but to date we’ve not seen major impact from FinTechs in the cross border payments space. That said, we expect banks to collaborate with FinTechs in areas where this results in additional value for clients.”
Lars Sjögren, Global Head of Transaction Banking at Danske Bank added, “Customer expectations and demands for solutions on the customer side are increasing … if you partner with someone from a totally different industry you can bring reach on a global level.”
SWIFT’s Head of Banking, Harry Newman, describes correspondent banking as “A child of the 1980s,” and Citi’s Managing Director of Payments and Receivables, Ireti Ogbu agrees that cross border payments in terms of the traditional SWIFT payments have had their day, and better solutions are entering the field: “This market is ripe for change. Recently there have been significant steps forward with the launch of SWIFTnet, initiatives like GPI and the exploration of incorporation of new technology and FinTech partnerships into the existing SWIFT model.”
Wim Grosemans, Head of Product Management, Payments and Receivables at BNP Paribas added: “It’s good that new players push us to question client experience. There’s lots of reasons to do this. If FinTechs are doing things better than us – let’s integrate, let’s work differently.”
The Banking Circle commissioned research clearly shows how banks of all sizes are embracing the concept of open competition and accepting the need to work with external partners across the ecosystem to provide corporate customers with the best service. Partnerships with Financial Utilities, such as Banking Circle, are identified as being a prerequisite for survival in the digital economy.
“As the international banking and payments map is redrawn, the winners will be those institutions – large and small – that can fully embrace a digital mindset,” comments
Anders la Cour, co-founder and Chief Executive Officer of Saxo Payments Banking Circle. “However, banks will only benefit from digital evolution if they are committed to providing an excellent service for their customers, coupled with the openness to internal disruption and the boldness to knock down legacy walls, in order to effectively meet changing market needs.”
The full report, ‘Re-drawing the Map: The changing landscape of cross border banking and payments’, which was commissioned by Banking Circle and researched and written by MagnaCarta Communications, can be downloaded here.